Chicago has received proposals for more than $1.2 billion in projects to convert outdated office space in the city's LaSalle Street financial corridor to affordable apartments and shops, a trend that's becoming more popular nationwide.
The LaSalle Street Reimagined initiative has received a combined nine proposals for seven vintage office buildings on and along the street in the city’s Loop business district, according to the city’s planning department.
Chicago Mayor Lori Lightfoot put out the call for proposals this fall, with the prospect that some projects could be backed by public money. The deadline to submit plans was last week.
Applicants have proposed apartments, a grocery store, a two-level market, retail and an e-sports gaming venue in historic towers that have been left behind. Former LaSalle tenants, such as Bank of America and BMO Financial, have decamped for trophy towers along the Chicago River in recent years, and demand for space on LaSalle has further been weakened by the effects of COVID-19.
Similar efforts to reimagine office buildings are playing out in cities from Los Angeles to New York as owners struggle to attract news tenants and get their properties' occupancy back to pre-pandemic levels.
It’s yet to be seen which Chicago proposals would gain city approval or how much the developers could receive in city funds and other public dollars.
Decisions on which projects would move forward could come as soon as spring, a Chicago Department of Planning and Development spokesman said in an email to CoStar News. The next step calls for the department to evaluate the proposals and get the community engaged in the process, he said.
Lightfoot previously said her goal is to create 1,000 new apartments, at least 300 of which offer affordable rents, as the city tries to cut down the supply of older, unwanted office space and address a shortage of affordable housing.
Some of the buildings targeted for conversions face foreclosure lawsuits or are in other states of financial distress.
Developers were asked to draw up plans to convert offices to apartments in buildings they own or have agreements to buy, with the requirement that at least 30% of the new units be affordable. The city offered the possibility of tax-increment funding and other city dollars that could be combined with historic tax credits and other public incentives to offset the loss in rental income from below-market rents.
The proposals, first reported by the Chicago Sun-Times, include two by Prime Group of Chicago.
Prime Group, headed by Mike Reschke, also is leading the redevelopment and eventual sale of the formerly state-owned James R. Thompson Center to Google, a project expected to bring thousands of new employees to the center of the city in a boost to the area.
Two proposals are for buildings where New York-based AmTrust Realty is foreclosure suits.
Here are summaries the proposals provided by the city:
400 S. LaSalle St.
Chicago developer Urban Resolve intends to convert a wide, six-story former Cboe Global Markets headquarters into student housing and an e-sports gaming venue. Scholastic e-sports companies LeagueSpot and Phoenix Sports Partners are part of the $104 million plan that would include a food court, student mental health and wellness center and fitness center.
111 W. Monroe St.
Prime Group and partner Capri Capital Partners plan to create 349 apartments, including 105 affordable units, in the former BMO office tower it recently acquired. Changes to the 23-story tower also would include adding a hotel on the lower seven floors, plus a spa, rooftop pool and restaurant. The estimated cost of the conversion is $180 million.
208 S. LaSalle St.
A Prime Group affiliate is involved in one of two proposals to redevelop the office portion of a 21-story office building at 208 S. LaSalle St., where the firm already has converted office floors to two hotels, a JW Marriott and The LaSalle.
In the latest conversion project, the Prime affiliate has proposed 84 apartments and a dog run, fitness center, lounge and access to hotel amenities at a cost of $130 million.
In a competing proposal, a development team including Chicago’s Sims Property Development & Management and affordable housing firm Brinshore Development wants to create 102 apartments within 208 S. LaSalle in a $50.2 million project.
Clark-Adams Building
Another property with competing plans is the 41-story tower at 105 W. Adams St., also known as the Clark-Adams Building.
Minneapolis-based Maven Development Group wants to invest $167 million converting it to 423 apartments. Its proposal would not include the lower 10 floors, home to a Club Quarters Hotel and Elephant & Castle Pub.
At the same building, a venture of Chicago firms Blackwood Group and Celadon Partners wants to take on a $192 million conversion into 185 apartments, with a two-level food market and Stockyards Coffee House shop at the base.
135 S. LaSalle St.
Chicago-based Riverside Investment & Development wants to convert the 44-story former Bank of America building to 430 apartments.
The $258 million proposal is in partnership with the tower’s longtime owner AmTrust and Chicago’s Blue Star Properties, which created the successful Revival Food Hall in a nearby office tower. The group proposes as much as 80,000 square feet of new lobby, retail, restaurant, event and cultural space, as well as a potential grocery store.
Riverside was the firm behind BMO and Bank of America's new leases at trophy office towers, while also providing extensive research for the city’s LaSalle Street Reimagined plan to help fill holes created by those large corporate departures.
30 N. LaSalle St.
At another distressed tower where AmTrust is the longtime owner, Chicago developer Golub & Co. and investment partner American General Life Insurance want to convert a 43-story tower into 432 apartments. The $186 million project would create new ground-floor retail, green space and seating along Washington and LaSalle streets.
170 W. Washington St.
In the smallest proposal, the building’s owners, restaurateurs and businessmen Scott Cochrane, Kevin Killerman and Carmen Rossi, are seeking backing to convert a thin, five-story office tower into four apartments. The $2 million proposal includes new retail and commercial space.